As Blackstone & Prologis Buy Up Industrial, These Local Players Make Bank

Malcolm Butters’ firm has been building industrial properties in South Florida for about 30 years. But the last three or four of those years have been nothing like what came before.

Companies such as Butters Construction have been forced to adapt to changes within an industrial market that has seen a massive influx of institutional capital from the likes of Blackstone and Prologis. Thanks to the rise of Amazon and e-commerce, these firms — especially Blackstone, which has north of $500 billion in assets under management — are paying top dollar for institutional properties.

That makes it difficult for smaller players like Butters to compete for deals to buy and develop new properties, especially in a place with little land left to build.

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Growth In Jobs, Housing Boost Demand For Industrial Real Estate

Warehouses are the hottest thing in commercial real estate these days.

Sustained growth in jobs, population and consumer confidence are driving expansion for contractors, building supply companies, food distributors and other businesses in need of industrial space across South Florida. As a result, vacancy are falling, rents are rising and developers are rushing to build more warehouses — in some cases “on spec,” without having tenants lined up.